The S&P has achieved the coveted close over 900 but in the process has become EXTREMELY overbought. How the market handles this situation will be a dead give away as to the direction we can expect. 

Markets that have REALLY bottomed after a 50% decline will find a way to defy gravity and confound the bears. Overbought won't matter much. This market exhibited some of those characteristics today.
 
If the bottom is really in then I expect the markets to make it difficult from here. One possibility is to create a pattern that makes it appear the market had a false breakout over 900 and is breaking down again, only to reverse back up with a full load of bears to devour.  Remember the 9-10% drop just last Monday?

Another option is for it to melt straight up another 10-15% in a matter of days leaving everyone dazed and confused. That would be almost unprecedented from these overbought levels, but we've seen many unprecedented things lately. 

Anyhow, the intermediate term rally option I've been favoring is looking better tonight, regardless of the path it takes. It won't be a permanent advance but it may be sizable. 

But I'd be foolish not to mention the obvious. The market COULD collapse from these overbought levels. They are extreme. However, it would take a move below 820 to convince me it was occurring. And with the markets rallying after the terrible economic news we've heard since Friday, it makes it all the more unlikely.